Logarithmic Yaxis Financial Glossary

What is it? The use of a log scale offers several statistical and interpretational advantages over a linear scale. It is principally employed because it measures vertical movement on a proportional basis; this ensures that a given percentage movement is always represented by the same distance on the vertical scale. If, for example, a share price doubles from 40p to 80p, the vertical movement is exactly the same if it doubles again to 160p.

Finance Term Definition Added By: Alex

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